Trends & Opportunities

Recent data indicates that Australian construction activity contracted for the ninth consecutive month in February. Yet the engineering construction subsector, buoyed by an increase in new orders, saw considerable gains and expanded slightly last month. The Australian Industry Group’s Performance Construction Index, released in conjunction with the Housing Industry Association, showed that overall, the construction…

The Aussie dollar is strong, our terms of trade are at unprecedented heights, and unemployment is at a two-year low. But what does the future hold for the Australian economy and our sharemarket? In the past year, the mining sector has compensated for underperformance in other areas, such as construction. Of course, enthusiasm for the…

As the United States and Europe attempt to claw their way out of a financial crisis, Aussies have been patting themselves on the back for hitching their economic wagon to China. China’s rapid growth has provided a strong demand for Australia’s abundant natural resources. And Australian businesses have enjoyed prosperity across the board, not just…

The announcement Wednesday by mining giant BHP Billiton of record Australian half-year profits, exceeding $10 billion, has re-ignited the debate over the Mineral Resource Rent Tax. The MRRT’s predecessor, the Resource Super Profits Tax, was a factor in the downfall of former prime minister Kevin Rudd. Before the August election, current Prime Minister Julia Gillard…

As Aussie housing prices have risen dramatically in recent years and LVRs have skyrocketed, leading economists and investment advisers have weighed in on the issue of whether Australia is experiencing a “housing bubble” and, if so, whether it will eventually “pop” or quietly deflate. Today we summarise several perspectives: 1. Steve Keen, Assoc. Prof. in…

Last year, Dr. Ken Henry, Secretary to the Treasury, described the Australian economy as a “three speed economy” in which: 1. The mining and mining-related sectors grow strongly;2. Other trade-exposed sectors (like many parts of manufacturing) grow more slowly; and 3. Non-traded sectors grow at a rate somewhere between those two, depending upon the relative…